SOFTS-Arabica coffee prices surge, raw sugar hits 5-month low
LONDON, Jan 7 (Reuters) – ICE arabica coffee futures rose sharply on Friday, boosted by concerns about the outlook for Brazil’s crop and declining exchange stocks, while raw sugar slid to a five-month low.
COFFEE
* March arabica coffee KCc1 was up 3.4% at $2.3950 per lb by 1448 GMT.
* Dealers said the outlook for this year’s crop in top producer Brazil remained a central focus with drought and frosts in 2021 denting prospects and concern that recent rains had been excessive in some areas.
* Severe rains have flooded coffee fields and other crops in central eastern areas in Brazil, the latest in a climate roller-coaster for the nation’s agricultural regions.
* Falling exchange stocks remained a supportive factor.
* Certified ICE arabica coffee stocks were at 1.52 million bags as of Jan. 6, down from 1.60 million a month earlier.
* “At this rate, it’s not inconceivable to see 1 million or less by summer … this should in turn lead to a more inverted market which will also encourage funds to continue to position from the long side,” Cardiff Coffee Trading said in a report.
* A drop in exchange stocks reduces the amount of coffee which can be tendered and can lead to nearby months trading at significant premiums to more distant positions.
* March robusta coffee LRCc2 rose 1.6% to $2,343 a tonne, climbing towards a 10-year high of $2,384 set in late December.
(Source: https://www.nasdaq.com/articles/softs-arabica-coffee-prices-surge-raw-sugar-hits-5-month-low)